Estate agents, can you trust what they say?

velo11

hi, Ive been looking at a house recently which requires a lot of work. Apparently it has been on the market for a few years. I have visited it twice and I guess the estate agent is surmising Im interested at this point.
Suddenly in the last few weeks he tells me there is a cash offer in for 200k. Can he legally say this if it isnt actually true? Im just thinking this seems a ridiculous coincidence given that no offer ever came in until I appeared interested. I thought things had changed in Irish law where all offers need to be officially documented by the estate agent . Is this just another law that is in place but never enacted?
Thanks for your feedback

No Pants

He doesn't work for you. Why would you trust him?

paidi_ed

as the poster above has said, estate agent does not work for you, he is working for the seller and they have been known to make up phantom bids, more so in the boom but I wouldn't trust any of them. I would establish if your actually interested in the property and if you are settled on this particular property then come up with a price you feel you'd be comfortable paying. Put in an offer with a time limit on it and see what happens. Not sure if you can compel the estate to prove there is another bid but maybe another poster will know...

TwoShedsJackson

This 'law' you're thinking of doesn't exist. The estate agent is employed by the seller to get as much as he can for the house, and as such the agent will tell you whatever he think is necessary to get the most money he can out of you.

Citycap

Time to play him at his own game. Get a friend to be a prospective purchaser, view the property, ask questions about current offers, put in offer below yours etc. Meet up later and compare stories. You will get an idea of how the land lies

Paddysnapper

This has happened to me in the past!..My advice..Put in your bid, forget the alleged bid, be prepared to walk away, if the bid is phoney the Estate agent will call you back pronto!... Trust me "I've been that soldier". Good luck!

Marcusm

The EA should be subject to the rules of the Irish Property Services Regulatory Authority which has a code of practice, broadly, requiring fair dealing with potential buyers. That being said, I have yet to see a leopard shed its spots.

velo11

Thanks very much all of you for the advice. I'll definitely act on it. Citycap, I will get a friend to view the place in a week or so and see what he tells her. Should be interesting. I will follow your advice Paddysnapper and put in a bid that seems realistic to me.
Its really annoying that for what is generally the biggest purchase in ones life that one has to deal with an intermediary 'haggler' who fabricates other potential buyers for the benefit of the seller and themselves.

the_syco

velo11 wrote: »

Apparently it has been on the market for a few years. I have visited it twice and I guess the estate agent is surmising Im interested at this point.

You have three options;

• Bid against yourself/phantom bidder.
• Walk away.
• Minus €50k from what you were going to pay, submit the bid, and tell them that the bid will only be valid for one week.

Fighting Irish

velo11 wrote: »

hi, Ive been looking at a house recently which requires a lot of work. Apparently it has been on the market for a few years. I have visited it twice and I guess the estate agent is surmising Im interested at this point.
Suddenly in the last few weeks he tells me there is a cash offer in for 200k. Can he legally say this if it isnt actually true? Im just thinking this seems a ridiculous coincidence given that no offer ever came in until I appeared interested. I thought things had changed in Irish law where all offers need to be officially documented by the estate agent . Is this just another law that is in place but never enacted?
Thanks for your feedback

you can't trust anyone trying to sell you something!

i know a family that will trust anyone, and then give out about that person after the sale, some people will never learn

Fighting Irish

Marcusm wrote: »

The EA should be subject to the rules of the Irish Property Services Regulatory Authority which has a code of practice, broadly, requiring fair dealing with potential buyers. That being said, I have yet to see a leopard shed its spots.

agreed but still, any buyer should make a bid of what they are willing to pay, not a little over what someone else is willing to pay

Wabbit Ears

Its hilarious that in this day and age people are still falling for this scam, which is why the agents are still doing it..

This thread is EXACTLY the same as if the OP were asking should he really send that 10 grand to Nigeria so he can get 50% of several million dollars.....


I find it amazing that its not law that all bids must be in writing with the bidders details and signatures and once a purchase is to be completed that the lawyers verify the authenticity of the bids. Seriously, you're paying additional tens of thousands on a salespersons word without any proof... Thats fcuked up this blatent and seemingly perfectly legal fraud.

velo11

totally agree with you Wabbit Ears. If what you are saying above is something that was legally tied to the conveyance and signing of the final deeds of the property then this game would stop quickly. I understand the price cant be regulated as bidding wars put pay to that. I think I'll look up Irish Property Services Regulatory Authority as Marcusm has mentioned to see exactly what a buyer can legally request of an EA re bidding information etc.
As house buys are clearly a huge investment they should be regulated and all transactions should be made clearly visible to all parties before that final signature is signed. I'll let you know what they say. Thanks again everyone for the feedback.

velo11

the_syco wrote: »

You have three options;

• Bid against yourself/phantom bidder.
• Walk away.
• Minus €50k from what you were going to pay, submit the bid, and tell them that the bid will only be valid for one week.

thanks, number 3 looks like a likely option. I really genuinely like the property. I just have a gut feeling about it.

johndaman66

velo11 wrote: »

Im just thinking this seems a ridiculous coincidence given that no offer ever came in until I appeared interested.

Do you know that for sure though? Did the Estate Agent clarify this. i.e. there may have being previous offers in on the property but they were rejected or sale feel through due to buyer not being able to attain a mortgage. Also are there any other Estate Agents carrying the property in their books? They may have had offers in previously?

Finally, I wonder was the asking price dropped recently? This would certainly explain why there is increased interest in the property.

EricPraline

There's a short article about the issue here. In summary, agents are obliged to scribble notes to record bids, but you won't get to see them.

According to the code of conduct established by its own professional body, the IAVI, member estate agents “shall ensure that the identity and contact details of all those making offers, the amount of all offers and all responses to offers are noted either manually in the property file or electronically in a retrievable fashion” and that “such records shall be retained on file for not less than six years after the marketing campaign ceases”. It would appear from this that, if you made a complaint to the IAVI (assuming the agent you were dealing with is a member), then it could look into the matter for you. But, as this is a self-policing profession, it is difficult to see what is really in it for you in the long run.

OP ask yourself, if you were buying a used car, would you expect the used car salesman to be 100% honest about the car's value and the level of interest in the car?

SeanSouth

Look, I'm no fan of estate agents or their tactics but let me play the devils advocate here for a minute.

You've rolled up to this property, you like it and you have knowledge that the house is on the market for a long time. A natural reaction from most punters is to put in a low ball offer and try their luck ! On the other phone the agent is listening to the Vendor tell him, to only make contact with offers over 200,000.

The Estate agents job is to try and make the deal work, to bring the parties together, to get them to agree. What he is doing here is one of two things 1) being honest and there is another bidder with 200,000 or 2) he is just setting the floor price as per instructions from the client.

In the current market, I very much doubt that its a case of the estate agent trying to improve his commission. All he wants is to get the sale across the line.

You need to decide on your price and be prepared to lose the property if needs be. Don't worry there will be plenty other properties that you'll fall for.

Duckjob

Hi OP. Unfortunately there is no mechanism to prevent, or even deter EAs from indulging in this particular type of fraud , and make no mistake, fraud is what inventing fake bids is. I'm pretty sure if an auction house was discovered to be injecting fake bids in an auction to ramp up the price, they would find themselves in some legal bother quickly enough.

Not saying they are lying about bids or not, and unfortunately there is no easy way to tell, you just have to follow your nose.

I always found best strategy was to large ignore anything the EA has to say about offers made / rejected etc. Decide for yourself how much you like the property and what is your maximum bid based on that. Then, maybe put in an initial bid and then go quiet for a while. At all times, try to resist the temptation to contact the EA to find out about your bid - try to wait and have him/her contact you instead.

If you get the higher bid story and sense you are being played, drop out completely. If EA contacts you saying the higher bid fell through, put them under pressure - tell him your previous offer of €x is now off the table and your new offer is €x - 10k, and it's only available until end of week etc.

Property Price Register can be a useful resource to see what similar properties in the area have sold for recently, and can help you sniff out if EA is trying to feed you horsesh*t.

Good luck with it

SeanSouth

I'm afraid Duckjob is talking through his ar*e. This is nothing illegal about fake bids and it's certainly not fraud. In my view its unethical but that's as far as it goes.

As far as auction houses go, its perfectly legal for an Auctioneer to "take bids off the wall" to ramp the bidding up to the reserve price. It happens all the time. Basically the Auctioneer points to an imaginary ghost bidder at the back of the room and accepts the imaginary bid to keep the bidding going. This is the same reason why most seasoned auction "goers" stand at the back of the room.You might not like it but that's the way it is and there is nothing illegal about it.

It's up to the bidder to decide in advance what he is prepared to pay for the property and stop there. It's not a race, It's not a contest. No one is forcing you to make the bids. It's you against the world and there is no there to shout foul

Duckjob

SeanSouth wrote: »

I'm afraid Duckjob is talking through his ar*e. This is nothing illegal about fake bids and it's certainly not fraud. In my view its unethical but that's as far as it goes.

My ar*e begs to differ

Example:

An EA tells me there is a bid on a house of €180k. In reality the highest bid is €150k. I make an offer and subsequently buy the house at €185k. The EA has used a false statement to induce me into a contract to buy a house for €185k. I would not have entered this contract had the EA not made that statement.

I'll concede that regardless of the legal interpretation, it's next to impossible to prove in property bidding context, given its verbal nature.

SeanSouth

Sorry Mate, you're wrong again.......

Misrepresentation can only take place between the two parties of a contract, of which the agent is neither. The agent will not normally have any authority to contract or bind the client to anything.

If you look closely at the estate agents terms and conditions, you will usually read something to the effect that nothing the agent says or does should be interpreted as being contractually binding on the Principal etc etc etc
All information is for "guidance" only.

OMD

SeanSouth wrote: »

I'm afraid Duckjob is talking through his ar*e. This is nothing illegal about fake bids and it's certainly not fraud. In my view its unethical but that's as far as it goes.

As far as auction houses go, its perfectly legal for an Auctioneer to "take bids off the wall" to ramp the bidding up to the reserve price. It happens all the time. Basically the Auctioneer points to an imaginary ghost bidder at the back of the room and accepts the imaginary bid to keep the bidding going. This is the same reason why most seasoned auction "goers" stand at the back of the room.You might not like it but that's the way it is and there is nothing illegal about it.

It's up to the bidder to decide in advance what he is prepared to pay for the property and stop there. It's not a race, It's not a contest. No one is forcing you to make the bids. It's you against the world and there is no there to shout foul

IPAV Auctioneers obligations to third parties
http://www.ipav.ie/Documents/Member_Area/Continuous%20Professional%20Development%20-%20Cork%2007-Nov-03/Obligations%20and%20Entitlements%20of%20Auctioneers%20and%20Estate%20Agents.pdf

•A duty not to misrepresent or falsify details of a property or to unfairly enhance its characteristics or value to induce a purchaser to purchase the property under false pretences. In such circumstances the purchaser might sue the vendor who in turn might sue the auctioneer or estate agent - making them indirectly liable to the purchase

•A duty not to knowingly accept fictitious bids which have been made solely in an effort to “puff up” the real bids.

“Puffing Up Bids”: Where an auctioneer knowingly accepts fictitious bids made in an effort to puff up the real bids, the highest bidder may revoke the contract and recover any deposit paid with interest.

Duckjob

SeanSouth wrote: »

Sorry Mate, you're wrong again.......

Misrepresentation can only take place between the two parties of a contract, of which the agent is neither. The agent will not normally have any authority to contract or bind the client to anything.

If you look closely at the estate agents terms and conditions, you will usually read something to the effect that nothing the agent says or does should be interpreted as being contractually binding on the Principal etc etc etc
All information is for "guidance" only.

In legal terms, the estate agent "an agent" of the seller. They are hired by, and receive remuneration from the seller for negotiating the contract terms (ie the price) on their behalf.

Therefore, they can most certainly make a mispresentation, and the seller, as the other party of the contract could be held legally responsible for that misrepresentation. The seller could then *theoretically* sue the EA for the loss of the contract, which could be voided by the misrepresentation.

As I already said , given that it's virtually impossible to prove, it's pretty irrelevent, but technically it's covered by basic contract law.

number66

A couple of months ago a "for sale" sign appeared on the apartment building I live in, about a week later a "Sale Agreed" sticker appeared on the for sale sign. about 2 weeks after that I was approached by a couple as I was leaving the building, they said they where interested in buying the apartment and wanted to ask about the building.

Moral of the story, is don't believe anything an estate agent tells you.

riclad

Look at my home, ie, daft,ie ,
see what other houses are listed at ,
LOOK at property register ,what houses sold for in the last 6months.
you can work out ,whats the house worth.
if you think its worth x you can get your solicitor to put in a bid in writing .
IF you pay too much for a house now its your fault .
MOST AREAS have loads of houses for sale .
the boom is gone .
the time when people paid 300k for an ordinary 3bed semi deteached house is gone.

you may pay 10k extra because theres 1 house for sale in a small quiet estate ,
and it suits you for work, schools etc thats up to you.
or i know streets wheres there,s a house for sale once every 3 years.

i know a certain area ,in Dublin
Prices there are between 135k, 150 k,for a semi d 3bed house .
IF you paid say 170k now ,you,d be very foolish.

3 years ago prices there were 180k.

SOMEone may choose to pay abit more than a house is worth,
because they just want to live in that estate, rather than buy a house thats a mile away ,
in a bigger estate ,thats further from a school, or a dart, railway station,
Even though they could buy another house thats identical for 175 k
a mile down the road.

SeanSouth

@Duckjob, I think you're trying to wear me out........

Best thing to do is drag him into court and tell the judge what you just told me here and report back how you get on..........:rolleyes:

Duckjob

SeanSouth wrote: »

@Duckjob, I think you're trying to wear me out........

Best thing to do is drag him into court and tell the judge what you just told me here and report back how you get on..........:rolleyes:

I've said twice whether or not there's a legal case is largely irrevelant due to the verbal nature of the bidding process meaning proving what EA said would be next to impossible.

You could save wearing yourself out if you read my posts properly

Ortiz

number66 wrote: »

A couple of months ago a "for sale" sign appeared on the apartment building I live in, about a week later a "Sale Agreed" sticker appeared on the for sale sign. about 2 weeks after that I was approached by a couple as I was leaving the building, they said they where interested in buying the apartment and wanted to ask about the building.

Moral of the story, is don't believe anything an estate agent tells you.

How is that the moral of the story...?? Surely that couple are simply the people that agreed the price? Otherwise why on earth would the agent mark the property sale agreed if it was actually still for sale - they only get paid when they actually sell the property...

velo11

johndaman66 wrote: »

Do you know that for sure though? Did the Estate Agent clarify this. i.e. there may have being previous offers in on the property but they were rejected or sale feel through due to buyer not being able to attain a mortgage. Also are there any other Estate Agents carrying the property in their books? They may have had offers in previously?

Finally, I wonder was the asking price dropped recently? This would certainly explain why there is increased interest in the property.

Hi, I rang a number of weeks ago and someone else in the EA's office informed me no offer had come in. Now that said, that person may not have may not have been fully au fait with that property. The EA didnt indicate that the price had been reduced. I presume he would have to emphasise how keen the seller is to sell. Its all a guessing game really and a learning curve. Need to ask these questions in future. Thanks for the advice.

velo11

OMD wrote: »

IPAV Auctioneers obligations to third parties
http://www.ipav.ie/Documents/Member_Area/Continuous%20Professional%20Development%20-%20Cork%2007-Nov-03/Obligations%20and%20Entitlements%20of%20Auctioneers%20and%20Estate%20Agents.pdf

•A duty not to misrepresent or falsify details of a property or to unfairly enhance its characteristics or value to induce a purchaser to purchase the property under false pretences. In such circumstances the purchaser might sue the vendor who in turn might sue the auctioneer or estate agent - making them indirectly liable to the purchase

•A duty not to knowingly accept fictitious bids which have been made solely in an effort to “puff up” the real bids.

“Puffing Up Bids”: Where an auctioneer knowingly accepts fictitious bids made in an effort to puff up the real bids, the highest bidder may revoke the contract and recover any deposit paid with interest.

this is really helpful but if you look at the clauses above who polices these duties if bids by third party would be buyers are not generally made visible to the buyer post purchase. It appears they are regulating their own actions! Maybe each EA is sporadically audited internally by IPAV?

Ortiz

velo11 wrote: »

this is really helpful but if you look at the clauses above who polices these duties if bids by third party would be buyers are not generally made visible to the buyer post purchase. It appears they are regulating their own actions! Maybe each EA is sporadically audited internally by IPAV?

The PSRA polices it. As far as I know they have actually done spot checks in some EA offices to ensure records are being kept of bids and that there is a note that all those recorded bids have been passed on to the vendor.

The IPAV would have nothing to do with this

velo11

SeanSouth wrote: »

I'm afraid Duckjob is talking through his ar*e. This is nothing illegal about fake bids and it's certainly not fraud. In my view its unethical but that's as far as it goes.

As far as auction houses go, its perfectly legal for an Auctioneer to "take bids off the wall" to ramp the bidding up to the reserve price. It happens all the time. Basically the Auctioneer points to an imaginary ghost bidder at the back of the room and accepts the imaginary bid to keep the bidding going. This is the same reason why most seasoned auction "goers" stand at the back of the room.You might not like it but that's the way it is and there is nothing illegal about it.

It's up to the bidder to decide in advance what he is prepared to pay for the property and stop there. It's not a race, It's not a contest. No one is forcing you to make the bids. It's you against the world and there is no there to shout foul

Can I ask what happens if the ghost bidder bids an imaginary bid and there are no further bids? Surely the auctioneer scores an own goal in this instance?
Frankly this is like a poker game. Cards close to chest..guesswork and hope for the best. I just feel in a world where most people are seen to be made accountable for their actions in the workplace there is something wrong with accepting the status quo around the behaviour of some individuals in that profession because thats the way it is.
I have no problem with bidding wars as long as they are authentic. These people have obviously everything sown up as they are largely self regulated (it appears) and any incriminating behaviour cant be challenged as its based largely on verbal interaction.

the_syco

velo11 wrote: »

Can I ask what happens if the ghost bidder bids an imaginary bid and there are no further bids? Surely the auctioneer scores an own goal in this instance?

You'll hear the bullsheesh about the other agent "not getting mortgage approval"... although, yes, it's an own goal if the EA reads you wrongly.

velo11

Thanks to everyone for your help and info throughout this thread. Much appreciated and a lot of food for thought. Ironically Im in the middle of a house move (in a renting capacity) so I have only had the chance to reply now. Thanks again.